Big boost for blockchain with ASX backing

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Australia’s largest stock exchange has signalled its intent to adopt blockchain technology to underpin its equities settlement and clearance system, it announced today.

The Australian Securities Exchange (ASX) is to turn to the distributed ledger technology to underpin its new system when it upgrades CHESS, the current ageing technology that it uses.

The contractor supplying the post-trade clearance system will be Digital Upset, a start-up headed up by former JP Morgan global commodities chief Blythe Masters, pictured left.

Masters hailed the news as a “precedent-setting event”, and added  that is is the first time that distributed ledger technology has been given a validation by a “major systemically important market infrastructure” whose standards from an enterprise point of view, she said, are as “exacting as they can be”.

The ASX had been planning to upgraded CHESS in any , said chief executive Dominic Stevens.

For that reason, said Stevens, ASX saw the upgrade as a “marginal cost” that will be part of the company’s capital expenditure program.

“The costs in rolling out this system I don’t think are too dissimilar to us having rolled out a traditional system,” Stevens told the Bloomsberg newswire service.

ASX also invested an undisclosed amount in Digital Asset, bringing the total raised by the startup from investors that include JP Morgan to more than US$115m (£86m), said Digital Asset in a statement.